Goldman Sachs on what's next for US housing
There's been a pause in the US housing frenzy in the past few months but Goldman Sachs says it won't last long.
"The supply-demand picture that has been the basis for our call for a multi-year boom in home prices remains intact," write economists led by Jan Hatzius. "Our model now predicts that home prices will grow a further 16% by the end of 2022."
They note tight inventories, decent home affordability and surveys showing strong buying intentions. Of all the shortages hitting the US economy, they warn that housing could last the longest.
"While the supply of home for sale has increased modestly since the spring, it remains well below pre-pandemic levels and the outlook offers no quick fixes for the shortage," they write, noting growing supply chain issues. "These headwinds are likely to limit the pace of annual homebuilding to around 1.65m in coming years."
